Are your Annual Investment Fees weighing down your Investments?

The COVID-19 pandemic brought the entire world to a standstill, with most of the major economies all but shutting down, companies on the verge of bankruptcy, or going under entirely, and many employees losing their jobs. When South Africa followed suit and went into lockdown, the recession began, and numerous people lost money on their investments due to asset and investment managers being unprepared for the Financial market instability. This resulted in clients’ assets not being invested in all the correct funds that would protect against capital loss or provide high returns despite the financial turmoil.

Our annual reviews have shown how clients’ investments took a knock during the last year, BUT the financial struggle in 2020 cannot be used as an excuse for over-the-top Annual Fees! If your investment return does not justify your annual Investment fee during 2020, or inception, a change needs to be made!

Let’s say, for example, that you were to climb Kilimanjaro and could increase your chances of summiting by getting rid of some excess weight from your backpack. In this instance, literal weight is dampening your performance and reducing your chances of achieving your goal. What if we told you that when it comes to your investments, the same logic applies? Costs associated with your investments are often overlooked or ignored but can nevertheless weigh down your future achievements on your ultimate financial goals as overall capital growth/gain is impacted. Being aware of the little things such as cost drag is an easy and effective way to improve on your future financial achievements. Here are a few investment fees that you need to be aware of:

  1. Expense ratio/ Internal expenses

  2. Investment management/ advisory fees

  3. Transaction fees

  4. Front-end load

  5. Back-end load/ surrender charges

  6. Annual account/ custodian fee

To find out more about Investment Fees, or make sure that these fees do not overpower your Investment growth, contact a PBA broker today.

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